Prominent activist investors post record 2020 returns despite pandemic-muted activity

Medifast

06/01/2021 22:05

By Svea Herbst-Bayliss
    BOSTON, Jan 6 (Reuters) - Some investors including William
Ackman and Glenn Welling, who push corporations to perform
better, posted record-breaking returns in 2020 when activist
investors generally backed off demands during a year marked by
wild and unexpected business conditions.
    Ackman's publicly traded Pershing Square Holdings  PSH.AS 
fund rose 70.2%, marking the best-ever return at his 16-year-old
firm Pershing Square Capital Management and one of the best in
the hedge fund industry. In 2019, the fund rose 58%, also a
record.
    Welling's Engaged Capital, founded in 2012 and known for
pushing companies like Medifast Inc  MED.N  and Hain Celestial
Group Inc  HAIN.O  to make changes, returned 51%. That tops the
firm's previous record return set in 2019 with a 34% gain.
    And Andrew Left, who has targeted companies he thinks are
over-valued through his work at Citron Research, told investors
that his hedge fund returned 155% in 2020, after gaining 43% in
2019, the fund's first year in business.
    The gains reflect a late-year rebound among activists -
fueled partly by strong stock market gains - with the average
fund up 6.7% in the first 11 months of 2020 after a 27% drop in
the first quarter, Hedge Fund Research data shows. Activist
campaigns were down 20% in 2020 from the previous year, Lazard
data shows.
    At Third Point, where Daniel Loeb unveiled a late-year
campaign at Intel Corp  INTC.O , the Offshore Fund finished up
20.6%, its best return since 2013 when it gained 26%. That came
after Loeb repositioned the portfolio and personnel in the wake
of a 16% loss in the first quarter.
    Blackwells Capital, currently bidding for Monmouth Real
Estate Investment Corp  MNR.N , gained 32% last year, their 
first time reporting their activist fund returns.
    Falcon Edge Capital, a steady investor in blank check
companies like the ones Ackman and Loeb's firms have created,
gained 43% last year.
    Representatives for the funds declined to comment.
    

 (Reporting by Svea Herbst-Bayliss in Boston
Editing by Matthew Lewis)
 ((svea.herbst@thomsonreuters.com; +1 617 856 4331; Reuters
Messaging: svea.herbst.thomsonreuters.com@reuters.net))